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Rite Aid fiscal 3Q profit jumps 16 percent

The Associated Press

Updated:
12/19/2013 12:07:18 PM EST

CAMP HILL, Pa.—Rite Aid reported its fifth-straight quarterly profit Thursday, but the drugstore chain's shares fell after it also lowered its 2014 earnings forecast, citing drug cost increases and a decreasing benefit from new generic medicines, among other factors.

The Camp Hill, Pa., company also said it expects a soft flu season, and sales outside the pharmacy in its established stores slipped in the recently completed quarter. Chairman and CEO John Standley told analysts during a conference call that his company's results from the front end of its stores, or the area outside the pharmacy, were hurt by the same challenges other retailers face: cautious consumer spending and a competitive promotional environment.

Drugstore bottom lines also have benefited in the past several quarters from a wave of new generic drugs that is starting to wane.

Rite Aid Corp. expects fiscal 2014 earnings to range between 17 cents and 23 cents per share on revenue of between $25.3 billion and $25.4 billion. That compares to a forecast it made in September for earnings of between 18 cents and 27 cents per share on $25.1 billion to $25.3 billion in revenue.

Analysts expect, on average, earnings of 23 cents per share on $25.37 billion in revenue, according to FactSet.